ADX (Average Directional Index) answers one question: how strong is the trend? Not up or down, just strong or weak.
- ADX below 20–25: weak or no trend. Range tools work better.
- ADX above 25: a trend is in play. Trend tools work better.
- +DI and −DI show direction: +DI above −DI = bullish pressure.
Wick says
ADX is the referee who tells you which game is being played. Trend game? Use moving averages. Range game? Use oscillators.
Key takeaways
- ADX measures strength, not direction.
- Above 25 = trend; below 20 = range.
- Use it to pick the right strategy for the conditions.